Manufacturers Expresses Concern over High Cost of Fund, Predict More Job Losses

Crusoe Osagie

The Manufacturers Association of Nigeria (MAN) has expressed concern over the high cost of fund available for the manufacturing sector, noting that the precarious state poses threat as more jobs would be lost if nothing is done to address the situation in the country.

Indeed, the sector has the capacity to employ thousands of unemployed youths with the right policies and enabling business environment from the federal government.

The president, MAN, Dr. Frank Jacobs, explained that the sector is going through a very difficult time, pointing out most manufacturers still have to depend on imports for their vital raw materials for production.

The MAN boss who was represented by the vice president, MAN, Mr. Isaac Agoye, at a business luncheon organised by the MAN Ikeja branch, tagged: Manufacturing in a Depressed Economy: The Way Forward said: ”We are going through a very difficult time and there has been a lot downsizing our work force, we are not happy downsizing our workforce but once things are beyond our control. Most of the manufacturers still import most of its vital raw materials into the country. We are trying to look inward to get some of our raw materials, but it is still not enough and even if we get them locally, they are expensive than the local ones.”

He added that: “With the issue of foreign exchange and you are aware that some items that have been banned. The 41 items by the Central Bank of Nigeria (CBN) and the companies affected by this policy are not finding it easy which means that they cannot get the foreign exchange to get their raw materials which means they have to find another means which are most times very expensive, but the new steps the CBN is taking we believe that we will begin to see light at the end of the tunnel.”

Furthermore, he said: “We are very resilient and we are determined because we know this is our country where other countries have experienced similar challenges in the past and they surmounted these challenges. I believe before the end of the year, something positive will happen in this country,” he said.

Also speaking at the event, an economist, Mr. Henry Boyo, said the manufacturing sector should be the galvanising agent for investment expansion, economic diversification and employment of labour in Nigeria, but unfortunately, the sector has not been able to satisfactorily perform these roles because of government misguided government policies, saying that the government is expected to provide the enabling environment for such positive participation of the sector.

According to him, the way forward to address these challenges is to bring down the cost of fund to 7per cent to provide manufacturers the opportunity to borrow at reasonable rates and also make the exchange rate stronger.
He said the 50per cent devaluation of the naira is going to send a lot of the industrialists and manufacturers packing, adding that the current inflation rate would constrict demand for locally produced goods in the country.
The chairman, MAN, Ikeja branch, Prince Oba Okojie, said the theme of the event is a veritable tool to draw attention to key issues of the moment, contribute to the critical mass of public opinion and to generally advance the sector’s policy advocacy thrust.

He said the biggest challenge of manufacturers is sourcing for forex as major raw materials are sourced overseas, but said the problem can be ameliorated by technological development through strengthening the nation’s technical colleges , inward sourcing of raw materials, stressing that Nigeria is blessed with abundant natural resources but still dependent on importation.